Early bidders will earn cash back.
Francois Carrillo, the guy behind Domaining.com, is getting ready to launch a new cash back program for bidding on his CAX.com domain marketplace.
The program will reward both the initial bidder in an auction and the second highest bidder with 2% of the sales price.
For example, if you are the first bidder and three people bid in an auction but you don’t win, you’ll get 2% of the sales price.
If you’re the first bidder in an auction that only attracts two total bidders, you’ll actually get 4% — 2% for being the first bidder and 2% for having the second highest bid. On a $1,000 sale this would mean $40.
If you’re the only bidder for a domain you’ll get 2% cash back since you were the first bidder.
The money is taken from CAX.com’s commission, not the sellers proceeds.
When I first heard of this deal I thought people would try bidding to earn money and walk away if they actually one. But CAX.com charges a one time membership fee that should reduce the incentive for people to do this.
The announcement about the cash back bidding is on a great domain in itself: Everytime.com.
The promotion begins July 4. Since Francois is French, I don’t think the timing has anything to do with the U.S.’s Independence Day holiday.
Jo says
No bueno on the 2% for the second highest bidder. I have a special skill and I’m sure others do too at being second highest. Especially easy to do if you know the bidder handles of those you are up against. Good for me, bad but really shady otherwise.
And every time you drive up the price higher for the person who will eventually win them you are just increasing your payout from the 2%. So you may win some domains by accident sometimes, big deal, a calculated risk to be added into the formula for 2%-jacking auctions. People will be bidding just for the money. Cool though if two bidders are duking it out up to $10k and you come and bid $100 more then one of the others outbids you by $100 and wins. You just earned $200. Do that 5 times a day, now $1k.
2% for the first bidder is a bit shady too, though passable I think. So take a domain that you know will sell at auction for more than $10k (though this one is way more risky). So make a first bid of $10k. You just made at least $200, that was easy, but risky so be good at it.
Alexander says
I applaud Francois for coming up with ways to encourage domaining activities. We need more leaders with ideas and action to make things happen.
Osy says
Great idea. As always, Francois keeps exploring new ways to improve his sites.
Greg says
Is this a joint venture with Halvarez?
Article Writing says
Great idea. Just hope that this doesn’t increases the spam bids.
Francois could take a step further and set a rule of some initial deposit to be eligible to bid on $500+ or $1000+ auctions. This will keep away those bidders who are bidding to stay 2nd and earn comission.
Just my two cents…..
Jp says
If you turn bidding into a game it will be gamed. 2% to the 2nd highest bidder makes it better to be 2nd highest than highest. Then you get money just for playing.
Francois says
@Jp and Jo
Find out a serie of requirements and measures to stop or strongly refrain possible fraud:
1 – Nobody can place a bid without having previoulsy paid a $10 lifetime “Trader” membership or $50 “Domainer” membership for bids over $10K.
2 – Any buyer who will not pay a winning auction will be banned for life and will not get any refund of his membership.
3 – Minimum bid amount that should be possible to be placed in a running auction will be 1.5% over the current top bid.
4 – Minimum membership level to make money as second high bidder of a successfull auction will be “Domainer”.
At the inverse of what Jp and Jo are writting the point (3) eliminate this potential problem.
Now if there is potential issues and solutions exist to fix it, you are welcome to let me know.
@Article Writing
I cannot do that because it’s all the interest of this incentive. Allow domainers with low budget but agood domaining knowledge or gut to make money not flipping domains but searching domains of interest others should be interested to acquire and get rewarded for that work.
With the risk for sure to win the auction, but in this world only people getting some risks make money!
Jonty says
Very clever.
jp says
I don’t know. If I had a nickel for every time I was second highest at NameJet then I’d have a lot f nickels. Now if I had 2% of the final price for everytime I was second highest then I’d have many thousands of dollars. I’m not trying to be a negative Nancy. It’s innovation like this that is needed. IMHO I think $50 is a small barrier. I still feel like people are getting paid to schill bid. Look at it this way, if every auction gets bid a little higher just coz the 2nd bidder knows they are gonna lose anyway then the big loser is the auction winners. Over the course of a year if every auction winner paid an extra $500 on average then that would add up. Good for everyone but the winners.
I do like the push to auction 2% bonus for taking the risk. Even if people find a way to make money off of it I don’t see it as shady.
jp says
@Francios
I’ve been putting in some thought on how I would reward the 2nd highest bidder if this person were to be rewarded. Perhaps with 2% but of auction credit, to give them a leg up at being the high bidder next time. The 2% cash for the first bidder still makes sense for me. Ok that’s it for my 2 cents.
Francois says
@jp
Like I said, if you have a good domaining knowledge and/or gut and your idea is make money applying your knowledge by doing bid wars on domains you estimate the sale price is under its potential value you can and are welcome, sellers will make more money!
Now have in mind doing this stupidely as you suggest you take huge risks and probably will be blocked very soon by the measures I put in place.
Just as a reminder eCOP requires for ALL escrow transaction sales over $1K to have a a verified account, which mean you send a copy of your ID, or passeport and a recent utility bill, so you could not act anonymously and could not act twice.
Now this is a test for the summer, we will see where it leads, the idea is CAX.com sellers make more and better sales and buyers get good names or make money. It’s strongly possible we need to update or improve all this to have a still more secure and appealing marketplace.
Now just for the fun, know it’s the director of my bank (which I converted) who called me yesterday suggesting that I should offer an incentive to first and second bid (I changed the second bid to second highest bid) something I already in mind to try but his call pushed me. He said in financial markets investors rarely purchase company shares with the idea to acquire a company but to make money contributing to inflate his value, and this it what create liquidity.
As I refresh the page to see if I must respond to others I am noticing your suggestion that I found very clever in fact! Yes, reward the second high bidder with a 2% credit that could only be used to buy domains will make the scam attempt described previoulsy obsolete.
Don’t be astonished I decide to apply this rule before the launch.
Thanks!
bob says
“On a $1,000 sale this would mean $40.
The money is taken from CAX.com’s commission, not the sellers proceeds.”
Which is correct?
Both cant be, unless cax is getting 100% commission.
Andrew Allemann says
@ Bob – CAX.com takes $80-$100 from a $1,000 sale, so it gets $40 from its commission to the bidder.
Francois says
In other words while others raised their sales commission to 15% we will keep 4% to 6% to pay escrow fee, marketplace, advertising cost and make a living!
jonty says
CAX = Computer Aided Exchange (trademark of DaTelCo)
Epic Fail.Or maybe I should say Epik Fail.
Francois says
I totally reviewed and updated Everytime.com incentives after feedback, test and better thoughts:
First and second high bidder of a CAX auction can be rewarded up to 20% sales commission!
Each domain owner fix the bonus they want to reward from their sale earnings.
Find out a serie of measures to stop possible fraud:
– Nobody can place a bid without having previoulsy paid a $10 lifetime “Trader” membership or $50 annual “Domainer” membership for bids over $10K.
– Any buyer who will not pay a winning auction will be banned for life and will not get any refund of his membership and will lost all his incentives earnings.
– Minimum bid increase that should be possible to be placed in a running auction will be minimum half of the second high bidder incentive.
– Bonus will be earned only if the auction closed over the reserve price and the escrow of the sale by eCOP.com is successfuly completed.
– Profit generated will be put into your eCOP.com balance. Except you won the auction, money could exclusively used to pay transactions secured by eCOP.com, private or from marketplace offering this escrow service.
Johnnie says
They should just fix the site. When you go to cax.com directly, there’s nothing there that most sites have, some basic stuff.
No privacy policy, about us, how to use the site etc.